Birdie Boy
Well-known member
- Jun 17, 2011
- 4,108
You missed out hair dressers with 2 diaries/books and no card machine, ie everything cash.. you don't see many skint hairdressers..
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[Football] HMRC
- Thread starter BensGrandad
- Start date
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Needs to conclude and the appropriate 15 point penalty implemented.
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What a coicidence that your question about why “a footballer ...” falls this particular week.
Smells of not so subtle gossip / shit stirring.
father_and_son
Well-known member
The issue with a number of these "dodges" is that they were legitimate, authorised and registered schemes that have been referred to, reviewed and approved by HMRC. This is nothing to do with "unscrupulous advisers and naive and greedy clients". This is all above board and a way to reduce your tax liability.
The HMRC can then decide that the activity is no longer acceptable.
Any normal person would expect HMRC to announce that said scheme was no longer acceptable, people could react, move their money, etc etc and from the following tax year no-one would be allowed to use that scheme anymore... but OH NO! HMRC can and do *RETROSPECTIVELY* make a previously approved scheme unacceptable and go after everyone who has used that scheme to limit their liability. As the scheme was previously approved and registered, it is very easy to find out who used the scheme.... THE CODE APPEARS ON THEIR TAX RETURNS!
This is clearly completely f*cked up but HMRC are a bunch of CJTCs and the reversal of decisions is often challenged and over-turned but in the meantime they will issue fines against everyone and aggressively pursue both the fine and the tax even before the legal challenge is heard.
Your options are then...
Pay the fine & back tax *AND* pay for a Solicitor to challenge the reversal... if you win you get the fine and tax back but NOT your legal fees.
Negotiate a deal to pay the tax and a reduced fine but waive your right to challenge the ruling.
or...If you haven't got the cash to actually pay and HMRC refuse to agree a deal, take your chances in court being prosecuted for Tax Evasion. Win and you get to keep your money... but win OR lose, if you are public figure, you will always be branded a Tax Cheat.
BensGrandad
New member
- Thread starter
- #65
See post no 54 which explains that it was nothing whatsoever to do with any current issues. As posted by another member there has been mention of West Ham and Newcastle and I just asked why this should be so prevalent in football.
Buzzer
Languidly Clinical
- Oct 1, 2006
- 26,121
I can't comment about all of them obviously but I used to work in practice and had a few hairdressers as clients and I didn't come across many hairdressers who looked like they were on very, very good money. I'd also add that HMRC have favourites that they love to go after: cash businesses where there's usually a sole trader who might not keep the best of books - hairdressers, taxi drivers and the like and I've seen for myself just how hard HMRC come down on these businesses, the penalties and fines imposed and how petty they can get about expenses claimed. This isn't just me speculating, take this quote from one of the UK's top accountancy firms in one of the top tax periodicals:
Roy Maugham, Partner at UHY Hacker Young, commented: "HMRC appears to be aggressively going after small businesses as 'easy pickings' and it's possible they will look to accelerate investigations next year and beyond to further close the gap, rather than going after big enterprise."
https://www.tax-news.com/news/HMRC_Raises_Extra_GBP489m_Through_SME_Crackdown____70931.html
This is why it angers me as a chartered accountant and as a taxpayer when I see HMRC doing deals with Google and Vodafone and Starbucks on how much tax they'd like them to pay, the lack of visibility about fines or interest charged and any warnings about future conduct. It also angers me with super-rich individuals like Gary Lineker who play to the gallery when moaning about NHS funding but then you discover he got involved in a complicated scheme to avoid paying tax on the sale of his Barbados holiday home. It also infuriates me when we look to plug shortfalls by cuts in spending in benefits rather than increasing tax revenues.
I don't agree with pretty much anything Labour spout about tax except for their comment that one of the best ways of proving your patriotism is to pay your bloody taxes.
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Was that true? Did not think it was
BensGrandad
New member
- Thread starter
- #68
Some years ago a friend of mine had a fish and chip shop in Epsom and fell foul of HMRC as they went into his shop at 2pm on a Friday and demanded that he count the morning takings then based his weekly takings on that. Everybody bar HMRC know that Friday was the busiest days trading but they wouldnt accept that and argued that it was just a typical day.
Buzzer
Languidly Clinical
- Oct 1, 2006
- 26,121
If you are referring to DOTAS then the acknowledgement that a scheme exists and issuing of a reference number does not signify the HMRC “approve” the scheme, it simply enables them to keep track of who is using it so they know who to go after if they can prove that it is evasion.
Buzzer
Languidly Clinical
- Oct 1, 2006
- 26,121
I think there may have been something lost in translation when relating the story. I have heard of HMRC reviewing takings for specific days for businesses and then making assessments of earnings based on existing stats and records that they have for that business sector. If that is the case then it would make sense to take the details for the busiest day as it is the one day that's least likely to be subject to huge fluctuations because of weather or whatever.
Something along the lines of Fred's chippy took in £XXXX on that Friday. He employs 3 staff, he's open 6 hours and from data from similar sized chippies that represents 45% of an average week's takings. Therefore HMRC calculate his weekly takings based on this.
Even then, every taxpayer has the right to appeal and if what you say is actually true then his accountant should be sacked for incompetence if they didn't challenge HMRC assessing a week's taking on Friday's income x 6 days. Tribunal panels are independent of HMRC so would give any business a fair hearing.
BensGrandad
New member
- Thread starter
- #72
Possibly, because people dont always tell you the whole story when relaying it and I can only say what I was told by the owner as a warning to me having another cash business ie a pub. Mind you this was 30 years ago so things could have changed.
FatSuperman
Well-known member
- Feb 25, 2016
- 2,830
Well I assume a lot of his mates, and most other politician's mates use these sorts of loopholes. I did read a while ago that closing the loopholes meant lots of pensions and that sort of thing would have to make changes, as this is what they were originally intended for. Seems to me it can't be that difficult to deal with sensibly.
Gotta love not properly accepting any genuine answer that posters have taken their time to give him.
FatSuperman
Well-known member
- Feb 25, 2016
- 2,830
All very true I suppose, although I take issue with some of the stuff HMRC are doing, or perhaps trying to do (I'm not sure it's approved yet). I believe that they are changing the legislation, and backdating it a decade (something like that). So something that was previously 'just a loophole', will now be considered unpaid tax. It's absolutely right that they close this and go after all offenders, but surely backdating it is seriously risky.
I worry massively if they do this because I run a Ltd co for my work and whilst I'm currently on the right side of the legislation, I have no idea what they might do down the line.
Time. That is the issue. He has all the time in the world.
He must be one of the regular Argus letters page writers as well.
Buzzer
Languidly Clinical
- Oct 1, 2006
- 26,121
Yep and see my later comment and link to the article about HMRC going after soft targets rather than the big boys. I empathise fully with you about worrying about tax compliance. You're expected to be able to run your business, keep all the necessary records and be (effectively) your own tax compliance officer when you've probably not got the time nor the skills in that specific area whereas the very biggest companies have whole departments of people whose sole job is to deal with the tax side.
If you fall foul of the law though, you won't get asked to negotiate how much tax to pay. You'll be told, you'll be fined, you'll be charged interest.
Buzzer
Languidly Clinical
- Oct 1, 2006
- 26,121
You know yourself as an ex-publican that stocktakers take a similar approach when they do their job and if a mark-up on a particular beer is below a certain percentage (I seem to recall from my dim and distant past as an accountant in practice that 56% was a popular figure) then alarm bells are raised. There's absolutely nothing wrong in having a cash business, just make sure you get a good accountant and if necessary a book-keeper.
BensGrandad
New member
- Thread starter
- #79
If the figure dropped below 56% you needed paper proof of promotions etc to explain the drop. I retired 17 years ago but wouldnt want a pub or any other business now, as you say there is too much red tape as well as trying to make the business profitable.
That doesn't work and never has done.
A well known former player by the name of David Beckham. His Tax Advisers threatened to do a ''Test Case'' on this. They put it to HMRC that they intended to invoice Manchester United for his Salary via his company on the grounds that his salary former only a minor part of his annual income and as such they were entitled to treat this as fee income as opposed to Schedule E Employment income.
They were told in no uncertain terms That if they even made an attempt to do this then HMRC would fight it to the Highest Laws of the land because it would threaten the whole of the UK Tax Laws in general. Not only did they threaten to fight that through the Courts but they told that particular firm of Advisers that they would also move against them for ''Malpractice'' and seek to have their Licence to Practice revoked.
There is nothing to stop players having fee income from image rights or Sponsorship deals or TV income through their companies but in no way can they have their Club Employer income paid that way.